05 Nov

New Phones to Retain Customers? Aren’t There Other Ways to Engender a Little Loyalty?

Original Article from Wireless Week

OK. I got your attention. I’m not going to suggest that handset subsidies go the way of the dodo. THey work. I will say that there are additional things – simple things, inexpensive things an operator could do to inspire loyalty. Giving away free smartphones just seems a bit excessive, given the other options.

Why bring this up now? MediaPost recently reported that wireless carriers are offering new handsets to mobile customers that want to upgrade devices more frequently – despite the fact that this is a relatively small audience segment. Upgrades are appealing, but there are more efficient or at least cost effective ways for mobile carriers to build better relationships with their customer base. For example, invest more in customer care and less on advertising – that would be a powerful step toward building lifetime customers. But the fact is, carriers do very little to build relationships today. The budget seems to go disproportionately to the top of funnel – and to free handsets – for both new and end-of-contract subscribers, rather than engaging current customers.

But this isn’t the only mistake that wireless carriers are making. Wireless carriers are delivering messaging on a customer’s bill and occasionally texting them with the expectation that these actions build relationships. These are transactional messages and customers tend to open them with the intent to pay a bill, not shop for a new service. In addition, many customers have auto payments, so they don’t even open these letters or emails. It is a waste of time for carriers to try to send a marketing message or build a relationship through these channels.

Wireless carriers are also not maximizing the potential of apps. App marketing offers mobile wireless carriers potential, but most carriers are taking these apps for granted. A big mistake that wireless carriers make is to assume that customers are using every aspect of their self-service app. Most consumers don’t use these apps for anything other than checking their balance and perhaps paying their bill. A small number might actually add a bundle of text messages to their plan. Wireless carriers need to leverage the data that they have to create relevant, helpful messages that will resonate with subscribers.

The entire buzz is around apps versus the mobile site, but what about something as ubiquitous as the home screen? This home screen economy offers carriers a great opportunity to build an intimate relationship with customers. Wireless carriers are in a unique position to be able to communicate with customers directly where they spend hours a day – on their phones. Carriers can use the home and lock screen as a medium to deliver relevant messages to customers. Think about it. A consumer uses their phone many times throughout the day and every time they pick up their phone they interact with the home screen. This real estate offers carriers a unique platform to deliver mobile content and messaging.

Wireless companies make huge investments on airwaves and this infrastructure offers a great marketing opportunity to help build loyalty among existing customers. The carriers can use the airwaves to deliver exclusive content to customers, which can help increase satisfaction and loyalty. The customer is always on their device. This is the perfect platform for the wireless carrier to build and nurture a good connection with these customers on an ongoing basis.

While the home screen offers wireless carriers an intimate and direct way to build connections with customers, it should be done with some savvy. The most important thing to remember is that the goal is to drive loyalty – not annoy customers. The truth is that some customers prefer a lot of communication from their carrier and others choose to limit their engagement. The key is having intrinsic measurements of those customer desires and enabling a platform that takes them into account.

The true key is delivering relevant content and data-driven stories, which will draw customers in. For instance, a customer that often makes international calls, yet hasn’t signed up for an international calling plan, will probably appreciate a home screen message explaining how much money they could save by signing up for the calling program. The message should make it easy for the customer to sign up for the service. Sending a relevant message, at a time when a customer has their phone top of mind, gives wireless carriers a unique and obvious way to connect with existing customers and help build relationships.

Using the home screen is also a great way for carriers to learn more about their subscribers and build a more robust data profile on customers. This, in turn, will help carriers deliver more relevant offers and messaging. Carriers don’t have user-level data beyond the mobile account holder. For example, if users have a family plan, the carrier will have only one contact. By offering content through the home screen carriers are given the opportunity to require individual users to opt in and share personal data, which can be harvested for insightful marketing.

For carriers it is more important to reduce the cost of customer care than it is to spend money on advertising. Using the home screen as a platform to communicate directly with customers not only helps build loyal relationships, it can also help carriers proactively reduce costs. The home screen offers carriers a chance to build an ongoing relationship day in and day out with customers, an ideal situation for creating lasting conversations. Offering a free handset is a nice perk, but it is just not as economical or effective for building customer relationships as home screen messaging can be.